In his career finale, a pioneering investor aims to lead a massive shift in communications.

Last week, Japanese investment giant SoftBank announced that it had closed $93 billion in committed capital for its massive Vision Fund, putting it within striking distance of the $100 billion target it announced last year. The Vision Fund dwarfs even the world’s biggest private equity vehicles, including the $22.5B mega fund that Apollo Global Management announced last month set to have been the largest in recent history. The Vision Fund would exceed the size of the five biggest private equity funds combined, according to investment research firm Pitchbook.

ARM acquisition provides a launchpad into IoT

Since the Internet boom of the late ‘90s, Softbank has set the pace for tech investing, betting huge sums to chase the rapid growth of the Internet, then retail distribution via online portals. It has made tens of billions in returns from investments in companies from Alibaba, to Yahoo and Supercell Oy. The first closing of the Vision Fund comes just three months after Softbank’s founder, Chairman and CEO Masayoshi Son made the biggest bet of his career with the $32 billion acquisition of chipmaker ARM Holdings Plc. ARM provides technology for 95% of all smartphones and seems poised to play a central role in the emerging “Internet of Things” (IoT) market that will network devices, vehicles, and buildings via remote sensors and processors. “ARM will be the center of the Internet of Things, in which everything will be connected,” he told reporters. “IoT is going to be the biggest paradigm shift in human history (and) we have always invested at the beginning of every paradigm shift.”

Venture capital vehicles, known for making the types of tech investments the Vision Fund is targeting, are typically even smaller than the giant private equity funds. For example, Technology Crossover Ventures’ 2007 fund VII was one of the biggest in history at only $3 billion. Only a small group of the hundreds of venture funds have established vehicles that total more than $1 billion.

Which markets will bloom with Vision Fund investment?

Industry observers wonder whether a behemoth investor of this size with considerable technology synergies will hit the ecosystem of venture investment like an asteroid landing on a desert island. According to analyst Kyle Stanford, the specter of price inflation for early-stage investments is already haunting the investment meetings at venture firms. “The fear is all rooted in the 2014, 2015 investment environment, where there were tourist investors and valuations were getting out of control, and when valuations get too high it limits exit opportunities,” Stanford explains. “When you see a fund of $100 billion coming in already making big headliner deals, I think that fear is going to come back.”

Those headliner deals depend on a healthy crop of well-financed growth stage deals, which have been on the decline even as overall investment activity has picked up, with first financing activity falling for seven consecutive quarters.

First financing activity has fallen for seventh consecutive quarters

Source: Pitchbook

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Over the short term, competition for top tier deals will heat up startup valuations, but the Vision Fund is also bound to have a profound impact on the kinds of technologies that get to market and their pace of development. $100 B in ambitious capital will drive investors to expand their investment activity to new technologies and markets.

One candidate is precision ag. With its ambition, its vision and it’s unique perspective as a Japanese company, Softbank seems set to play in the next chapter of the telecommunications revolution– beyond the internet, beyond urban networks to address the big challenge of feeding a population of 9 billion.

By 2050, 14 of the world’s 20 biggest metropolises will be in Asia and Africa, including Jakarta, Manila, Karachi, Kinshasa and Lagos as well as Tokyo, Shanghai. and Mumbai, according to a projection by Demographia. It takes about 1 acre to feed the average U.S. consumer. China only has about 0.2 acres of arable land per citizen, and an estimated 20% of that land is contaminated with toxic pollution. As a result, Chinese have been investing aggressively outside of China to produce food for their home market. High profile purchases include Australia’s biggest dairy operation and US-based Smithfield Foods.

Precision agriculture is a “must win” market for IoT leadership

As the world’s population grows, outright purchase of existing food production facilities will not suffice. Technology will be essential to feed burgeoning populations. Precision agriculture will be more than enabling technology, it will be essential for survival; to feed an increasingly crowded planet. This will be a “must win” flagship market for major technology and communications companies, from Intel and Softbank’s ARM to communications companies like Softbank’s Sprint, Verizon, BT and Telstra.

A Water Tech Company’s View of the World, with apologies to Saul Steinberg

For a start-up to succeed, it needs a well defined map of the world. That map needs to be as distorted as the famous “New Yorker’s View of the World from 9th Avenue.” This cartoon portrays a map of the world beyond the Hudson River that is a barren landscape marked only by Utah and Las Vegas before a tiny Los Angeles lies at the edge of the Pacific Ocean. China, Japan and Russia appear as sand dunes that mark the far edges of the world. Similarly, water tech companies have to see the world not only in terms of where water is scarce, but also where customers will pay a premium for advanced technologies. They need to define their view of the world based on where new technology can gain momentum.

China figures large in the water tech start-up map of the world, as does Australia. Going forward, we see island nations like Hawaii implementing a diverse set of distributed water solutions. The Middle East, and specifically the Gulf Countries, are also an important part of the water tech map of the world.

Historically, the Gulf Countries have accounted for a majority of the world market for desalination.

Advanced water tech solutions have to look beyond that general picture. On Tuesday, February 10, I moderated a panel at the US Commercial Service Sustainable Solutions Conference with Elizabeth Webley of Trevi Systems, Laura Demmons from Sylvan Source and George Mesiha from the US Embassy in the UAE. Trevi’s work at MASDAR offers an exciting example of what one company can achieve with a customer that sees the need for big changes and has the resource to invest.

“MASDAR is doing more than just piloting our system,” says Trevi CEO John Webley, “it has opened up the Middle East market. Since starting the pilot project last fall, Trevi has been approached by potential customers in Oman, Bahrain, Egypt, Kuwait, Saudi Arabia, Jordan and Iraq.” Trevi is speaking with Middle East prospects about desalination, but also about treating oil & gas produced water, oil refinery process water and inland brackish water.

Korean chemicals giant LG Chem’s announcement that it is purchasing NanoH20 adds a new chapter to that company’s rise from a UCLA lab to high profile leadership in a new generation of water tech companies.

Agile, innovative entrepreneurial management has been decisive in driving NanoH20 forward. Specifics of the acquisition have not been disclosed and the transaction is set to finalize on April 30. Established in 2005, NanoH20 is part of the first wave of start-ups that have brought start-up business strategies from the technology world to the water industry.

How will LG realize the full value of NanoH20’s entrepreneurial team and its corporate culture? NanoH20 broke new ground with five tactics that have been proven in high tech startups from software to solar:

Technology & business from the first dayNanoH20 was founded by an experienced technology entrepreneur, Jeff Green, and a leading-edge technology developer, Bob Burk. From its first days, NanoH20 developed its products and its strategy with an eye to how innovative approaches—in business as well as technology– might break through market barriers.

Finance from strong partnersNanoH20 launched with a $5M seed investment from top tier investor Khosla Ventures. With that early support, NanoH20 had the resources to develop the product as well as a team behind it.

As the company grew into an international player, NanoH20 raised capital from forward-looking water industry powers, including chemical giant BASF and oil refiner Total. It broke new ground by raising capital from CalPERS Clean Energy & Technology Fund, a large scale, long term investor that has led investments in sustainable energy.

Product design for retrofitsNanoH20 built its solution to allow retrofitting onto existing water operations. This product strategy tapped into the established budget structures to speed purchase decisions. For municipalities and industrial water users that already have water purification membranes, NanoH20 serves as an upgrade that provides big energy savings.

Focus upon diverse group of marketsEarly in its market launch, NanoH20 went beyond the municipal market to target early-mover commercial and industrial markets, like accommodations and oil & gas. The company’s first major installation was in the Cayman Islands, and it launched in critical markets from China to Saudi Arabia. In October 2013 NanoH2O announced a $45 million investment into a manufacturing facility in Liyang, China.

Next chapter?As part of LG Chem, NanoH20 may continue to break new ground in the water industry. With big company resource and market presence, will we continue to see NanoH20 drive development of game-changing intellectual property? New partnerships? New investment vehicles?

The perils of launching in the Chinese market have stymied even the most powerful technology companies as well as some of the most well-funded Cleantech companies, such as Venrock’s American Superconductor. However, patent theft from Western companies operating in China is only half of the story. Growth of Chinese patents is dwarfing that of the rest of the world. Patents are the backbone of a water tech company, and the early leaders in water tech should watch the Chinese patent war unfold. As a follow up to the Artemis CEO Forum China session, research analyst Xiaoding Zhuo wrote this blog on the “junk patent” phenomena emerging from China.

Patent TrollingHowever, the threat of the Chinese patent explosion goes beyond the patents that are granted internationally, to patents that are not fully examined or certified: “junk patents”.

Around the world, today’s standard patent writing process includes searching for related patents that have already been granted, or prior art. However, these searches often miss prior art in other languages. Languages like Chinese do not lend themselves to Internet searches.

Experts predict that we are seeing the beginning of a major new force for intellectual property rights—patent trolling.

Foreign companies in a host of industries are being targeted by “patent trolls,” that are to patent law what ambulance chasers are to personal injury law. High profile IP lawsuits by little known Chinese companies against some of the largest technology companies are the tip of the iceberg. foreign prior art has often invalidated U.S. patents. For example, BlackBerry device maker Research in Motion, paid $612 million to patent holder NTP in 2006 to settle an infringement case.

Although a majority of these “junk patents” are not certified, they still pose a legal threat to non-Chinese companies aiming to design similar products.

Xiaoding Zhuo is completing her Masters in Public Policy at UC Berkeley, focusing upon cleantech commercialization in China. Previously, she worked as a researcher at Harvard Business School and at a boutique VC/PE firm that invests in US cleantech companies entering China. Xiaoding holds a PhD in chemistry from Arizona State University, and a BS in chemistry from Peking University, China.

China is a central issue for water tech growth companies. It is set to be the epicenter of water innovation.

For decades, China has been using up its water at an unsustainable rate. 28,000 of its rivers have disappeared since the 1990s. Only half the water sources in cities are safe to drink. More than half the groundwater in the north China plain cannot be used for industry, while seven-tenths is unfit for human contact. China’s Twelfth 5-Year Plan includes ¥ 430 Billion or US$71.1 B in investment in water management.

Chinese Water Investment Under the Twelfth 5-Year Plan

While China’s water crisis might make it the most promising market for water, launching a water tech solution in China can ruin its value. On Wednesday, the Artemis CEO Forum tackled the China market opportunity in its inaugural session.

Dr. Xiang Wang, Orrick’s lead partner of China-focused intellectual property practice, spoke to the forum about how tech companies manage IP protection in China. Wang stated that IP protection is as much a business operations issue as a legal issue. “If you think that your IP hasn’t been copied, either your product isn’t very valuable or you just don’t know that it is being replicated,” Wang noted.

Despite the risk, China is a clear priority for the members of the CEO Forum. While it isn’t a major focus today, most of the eleven forum members surveyed see China as critical five years from now.

“How important will China be for your company in five years?”

Jim Matheson, CEO of Oasys anticipates that over the next five years, nearly 50% of bookings will be from Asia. He presented his company’s launch experience in China. Oasys is a leader in forward osmosis water treatment solutions, primarily targeting industrial applications like oil and gas drilling, petrochem and power generation. In October, Oasys raised $15 million in Series B funding, led by privately held Chinese engineering firm Beijing Woteer Water Company which was part of a broader strategic partnership between the two companies. “Finding the right partner and structuring the right relationship with them is critical for success in China,” Matheson stated. “We developed our relationship with Woteer over a period of 18 months and ultimately partnered with them exclusively for tackling industrial applications in China. Importantly, we included the strategic investment from Woteer as part of the overall relationship as we expect it will help us align our interests in the partnership.”

“What is/will be Your Business Model in China?”

Strategies for China with the forum companies run the gamut from licensing patents and know-how to joint ventures and setting up their own offices.

While launching in China requires significant management time over an extended period, cleantech companies in solar and wind energy have shown that the Chinese can move more quickly to scale projects following a pilot. Companies like LanzaTech, a producer of low-carbon fuels and chemicals from waste gases are showing how high profile government initiatives can provide an ideal combination of investment and on-the-ground partnerships to scale new technologies. Within two years of the CEO’s first trip to China, Lanzatech closed two major partnerships and completed its first full-scale project with $80M in Chinese financing.